Yesterday, Apple released the results for its 2016 fiscal third quarter (which ran from March 27, 2016 to June 25, 2016) and held a call with analysts to discuss the results. This is typically not a big fiscal quarter for Apple; the important quarter for Apple every year is the first fiscal quarter containing the holiday sales season, and during the fiscal third quarter, most potential Apple customers are waiting to see what new products Apple will introduce in the Fall. Apple reported revenue of $42.4 billion, which was down from the $49.6 billion that Apple reported in the 2015 fiscal third quarter, but was at the upper end of what Apple predicted three months ago. Don't lose any sleep for Apple — the company is still making tons of money — but it is just no longer making even more money every quarter as was previously the case. If you want to get all of the nitty gritty details, you can download the audio from the announcement conference call from iTunes, or you can read a rough transcript of the call prepared by Seeking Alpha. iMore also prepared a transcript. Apple's official press release is here.
As always, I'm not particularly interested in the financial aspects of this call, which did account for most of the call — it is, after all, an earnings call. But I'm always interested in the statements of Apple executives that pertain to the use of the iPhone and iPad. Here are the items that stood out to me:
iPhone
- Apple sold just over 40 million iPhones in the last fiscal quarter. By my count, that means that Apple has sold almost 988 million iPhones as of June 25, 2016.
- At some point very soon, Apple will sell its 1 billionth iPhone. In fact, it is possible that it will happen this week. [UPDATE: Apple just announced that it has indeed sold the 1 billionth iPhone.]
- Apple sells iPhones to three groups of customers: new smartphone users, users switching from another brand (typically Android), and users upgrading from an older iPhone. Apple CEO Tim Cook announced that this past quarter, Apple saw a higher percentage of switchers than ever before. Switchers and new smartphone users are important to Apple because hopefully those folks will stick with the iPhone and become upgraders in the future.
- Cook says that he sees the iPhone becoming "even more instrumental and important to people's lives" and "more and more your assistant, you're not going to leave without it."
iPad
- Apple sold almost 10 million iPads in the last fiscal quarter. By my count, that means that Apple has sold over 328 million iPads as of June 25, 2016.
- Apple said that its iPad revenue grew 7% versus the year-ago quarter, with an average selling price of $490 this year versus $415 in the year-ago quarter. In other words, people are buying more expensive iPads — the two versions of the iPad Pro.
- Cook announced that half of the people buying iPad Pros are buying them for work. That is certainly where I spent most of my time using my iPad Pro.
Apple Watch, Apple TV
- Cook hinted at future Apple Watch announcements, noting that Apple is "just getting started with Apple Watch and we look forward to even more exciting announcements in this space."
- Cook also hinted at future Apple TV announcements. He said to think of the current Apple TV "as sort of building the foundation for what we believe can be a broader business over time. And, so I don't want to be more precise than that, but you shouldn't look at what's there today and think we've done what we want to do. We've built a foundation that we can do something bigger off of."